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Five ground rules for the billionaires club

Early last week the Forbes 400 list was released, and the richest people in the United States were ranked.Bill Gates and Warren Buffett sit at the top of the list, while twenty-somethings Eduardo Saverin and Dustin Moskovitz of Facebook fame appear for the first time.Each of the 400 is worth at least $1 billion, and their leadership impact is impossible to quantify. Collectively these individuals have enormous influence on issues ranging from politics and philanthropy to the economy and business. In another type of article last week, Thomas Friedman continued to implore citizens of the United States to understand where the country is headed and how other nations see us. Friedman says simply that we must all start moving in one direction or the country will continue to falter. Can the rich help lead this effort, and if so, how?

1. Media

If you've made the Forbes list of wealthiest Americans, chances are you have unprecedented access to the media. Or, in Rupert Murdoch's case, you might own a portion of the media. Rupert's empire includes Fox, the Wall Street Journal, the New York Post, MySpace, DirectTV and major newspapers in the UK and Australia. The "left" has accused Murdoch of using his media empire for his own ideological gains. But if ownership provides a platform, so too does inclusion in the billionaires club. Despite the $700 billion that would be added to the US deficit over the next ten years, Donald Trump recently made the media rounds on Fox and CNN, advocating for extended tax cuts for the wealthy and suggesting that the job-creating rich will leave the United States in droves if the tax issue isn't solved. The larger question is, what do these leaders use their media platforms for? Are they further polarizing the public with fear, uncertainty and doubt, or are they genuinely trying to advance a solution-focused discourse?

2. Business

Of the top 20 richest people in the United States, 4 earned their wealth from Walmart, 3 got rich from Microsoft, 2 hit pay dirt with Google, and the brothers Koch are reaping the spoils of leading their father's energy and manufacturing empire through the new millennium. In short, 4 companies have produced 11 of the top 20 richest people in the country. With small business suffering, and Blockbuster and other mid-size ventures going bankrupt, big business may be consuming the American landscape. However, where we're going is difficult to say. Walmart has long been beaten up for its negative impact on local commerce, and the energy industries that have produced nearly 35 of the richest 400 are undergoing radical changes in light of growing environmental and sustainability concerns. Does such a concentration of power and wealth contribute to the American Dream, and how might these businesses guide the United States moving forward?

3. Economy

Tim Noah's piece, The United States of Inequality, takes a close look at the current disparity in wealth, which hasn't been this significant since before the stock market crash of 1929. According to Emanuel Saez's updated research, as of 2007 nearly 50 percent of the country's total income went to the top 10 percent of earners (earners of $109,600 or above), and 24 percent went to the top 1 percent. Similarly, the top 0.1 percent (fewer than 15,000 families, and they're making at least $11.5 million annually) account for more than 6 percent of the country's total earnings. In this past year the top 400 shared a net worth of $1.37 trillion, climbing 8 percent from last year, which translates to 2.6 percent of the country's private finances. While the economy's negative impact is holding much of the country by the throat, pushing the poverty rate to a 15-year high and keeping unemployment around 10 percent, the rich are truly getting richer. While there certainly isn't a quick fix, could the country's wealthiest be better leaders in pulling America out of the Great Recession?

4. Politics

In a democracy we all have a voice, but the reality is that our voices range in volume. David and Charles Koch own the majority of Koch Industries, an under-the-radar behemoth that owns oil refineries, Dixie Cups, Lycra and Stainmaster Carpets, among others. Koch industries was also rated as one of the top ten air polluters in the United States, and the Koch brothers "outdid Exxon Mobile in giving money to organizations fighting legislation related to climate change," as Jane Mayer outlines in a recent expose. Most recently, they contributed a cool million to suspend a California climate law. On the left, George Soroswas highly critical of the Bush administration and has been identified as a prominent contributor to the Jewish American lobby, J Street, as well as other liberal causes such as Moveon.org. Regardless of what side of the political fence you're on, the country's wealthiest have the potential to bring back some faith and trust to the political system. But does investing in legislation that is simply intended to make someone more money help or hurt our government?

5. Philanthropy

Many of our nation's wealthiest have contributed vast sums of money to various philanthropic causes. By 2007, the Gates Foundation had given roughly $28 billion to causes ranging from education to HIV prevention. Furthermore, Bill Gates and Warren Buffett recently created The Giving Pledge, an "effort to invite the wealthiest individuals and families in America to giving the majority of their wealth to philanthropy. " At this point, there are 40 pledges, with a letter that outlines the reasons behind each donor's decision. Letters from Warren Buffett and George Kaiser seem particularly poignant, providing a unique perspective on wealth and why they would give theirs away. Should the wealthy be expected to give their hard-earned dollars, or is this truly an American tradition that makes this country what it is?

With a media presence and a strong political voice, the Fortune 400 are more than business titans. These individuals can make waves when they want to, but are they focused on making the type of waves that will advance our country and keep our nation out in front?There's no denying that these people are leaders, but are they the type of leaders who are going to keep America driving successfully forward? As always let us know what you think--we look forward to hearing it.

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Comments

I think if there is anyone who will lead our country out of these hard times it will be these people. The amount of power and influence that they have on our country is astonishing. If there was a conscious effort to redirect some of that power into our country, they could potentially save our country. What i found most interesting was the surprising amount of philanthropic behavior that these people demonstrated. I think its great that they realize how much money they have and what it can do for the world through charity.

Posted by: M28R | October 5, 2010 3:10 PM

I think if there is anyone who will lead our country out of these hard times it will be these people. The amount of power and influence that they have on our country is astonishing. If there was a conscious effort to redirect some of that power into our country, they could potentially save our country. What i found most interesting was the surprising amount of philanthropic behavior that these people demonstrated. I think its great that they realize how much money they have and what it can do for the world through charity.

Posted by: M28R | October 5, 2010 3:09 PM

While the "Five Ground Rules" article makes some good and fair points, it always amazes me to see some of the resulting comments, and the utter stupidity or lack of understanding on the part of many who post comments... I guess "Simpleminded" is probably true, although not politically correct, oh well... Tough!

Scoogy, how have the "Rich been stealing from us" ? ? You and I do not have to buy their products or services. You choose to!
If you want to "Re-distribute" someone's wealth, by all means, give yours to charity, but neither YOU, nor the Federal Government has ANY right to re-distribute ANYONE's property.

As Phiggits has stated "Ah, the politics of envy on full display".... EXACTLY! Jealousy. "He has it, and I want it"...

While there are some who may have made money in "Less then ethical ways" (Read: Michael Milken and others of a similar ilk), most make it by coming up with a product or service that is attractive or valuable, and we (Voluntarily) buy it. And the problem here is what?

Here is a news flash for "Nicekid", Those on the Forbes 400 would be only too tickled to pay the "The same tax rate as we folks in the group formerly known as the Middle Class". If you actually knew and understood the tax structure in the USA, you would know that the super-rich pay almost 85% of ALL income taxes in this country. Yes, they earn 50% of all the money, but they pay 80 to 90% of all the income taxes....Duh!

Yes, not all of the rich are "Hard Working" or ultra-Smart, but that does not make them greedy or criminals. And some of those who are hard working, ARE criminals! Get over it!

Daedbird...Jeez, take a look at the tax rate structure before you stick your foot in your mouth! Please..... The rich pay a much higher percentage of their income in taxes then we in the middle class do! Get your facts straight! Do they take advantage of the various deductions in the tax code? You bet! Try reading the decision in U.S. vs Helvering, in which the Supreme court stated clearly that a tax payer has every right to so arrange his financial affairs to pay the smallest amopunt of taxes as would be applicable!

Grow up, work hard, invent something, make some money, and then let's see how much YOU favor re-distributionist tax theories... !

Posted by: richardhaight | September 30, 2010 2:53 PM

Don't buy into the class warfare, there are no black hats or white hats but a lot of grey.
Don’t blame the rich for succeeding and don’t blame the poor for failing.
We need moderates on all sides both rich and poor. All religions teach us their will always be the poor and it is the duty of the rich or the power of a democratic society to level the playing field as much as possible. Read about Malthusian Theory and how population will always outstrip resources to provide. Just like bad parenting intellectual laziness is passed on.

Posted by: J1107 | September 29, 2010 4:50 PM

It would take you TWO lifetimes to spend ONE billion dollars if you spent 20,000 dollars a day.

Billionaires possess too much money. Period.

Posted by: cmecyclist | September 29, 2010 12:23 PM

If you look closely, you will see that the flat tax is supported by the rich. They would love to see their taxes cut in half.

I believe in redistribution of wealth... the rich have been stealing from us for decades, and it's time we got our money back.

Posted by: scoogy | September 29, 2010 11:51 AM

So many Americans idolize the rich and believe in the American dream like lemmings. Leadership is earned and we have been lead off a cliff.

I agree with the poster who says alot of people need to get to know who they idolize before they view them as leaders. CEO make way too much money in this country and they are rewarded for this failure.

We are becoming more and more like a banana republic.

mhoust: I totally agree with you post. A flat tax with no gimmicks or social engineering would be fantastic. I am extremely skeptical this will ever take place because of the money shaping legislation in our leaders these days.

Posted by: theAnswerIs42 | September 29, 2010 11:09 AM

Income tax law in the United States is totally out of control; and the fault lies solely with each member of our Congress; both Senate and the House.

The solution is simple, but requires personal courage on the part of each member. Unfortunately, extreme cowardice and personal greed is endemic to that population.

The solution is to stop social engineering via taxation. Implement a flat rate tax (between 10 and 20%) that kicks in on the amount you make over the poverty level (about $21,000 per family of 4 in 2010), and no exemptions or deductions.

With no exemptions or deductions, there's no loopholes the rich (or anyone else) can hide or escape their fiscal obligations to the country, short of lying and failing to report their income.

Posted by: mhoust | September 29, 2010 10:59 AM

This is a very revealing article.
If most people read this, "maybe" they'd realize that these are the people that decide what they hear on tv, how much they pay in taxes and what comes out of their congressman's mouth. This is our American Political System!

Always on threads like this there are a few posters who become psychologist rather than addressing the history or facts.

Who were in charge of making large decisions that steered this country into the financial mess and recession that we are in? It's not the mail man down the street. Alot of CEOs and super rich have failed this country and worse yet, they are rewarded for this failure. There are many non rich that are still waiting for the trickle down to get to them, jobs and cash that are going offshore.

There are better places to look for leadership. Warren Buffet has some very good leadership qualities. Bill Gates also has some very good leadership qualities but he does not garner my respect. You should get to know more about the people that you idolize. If your criteria is wealth for determining success and intelligence, there are plenty of fools that idolized Micheal Milken.

CEOs make an absurd amount of money in this country, and for what? Our business model is broken.

Posted by: cirrus_nine | September 29, 2010 9:40 AM

Matthew 19:21-24 (New International Version)

21Jesus answered, "If you want to be perfect, go, sell your possessions and give to the poor, and you will have treasure in heaven. Then come, follow me."

22When the young man heard this, he went... away sad, because he had great wealth.

23Then Jesus said to his disciples, "I tell you the truth, it is hard for a rich man to enter the kingdom of heaven. 24Again I tell you, it is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God."

Posted by: scoogy | September 29, 2010 9:39 AM

Unless these Billionaires are related somehow to Karl Mark, I'll bet they give their money to Charity, to avoid the death tax. Giving excess money to the welfare state, is akin to throwing it out the window.

In this country, there are oportunities for anyone. It just takes preparation and hard work. The library is full of books to help you on your way.

Posted by: primegrop | September 29, 2010 8:46 AM

I have nothing against rich people who remember there are poor people in this country who can't help themselves, but for the most part they stick together and avoid these people. 10% of the people should not control 90% of the wealth in this country but they do.

Posted by: fmcoletta | September 29, 2010 8:35 AM

I've seen no evidence that WalMart has a negative effect on local commerce. They are criticized for their effect on local small businesses, which is a different thing.

Posted by: EvilOverlord | September 29, 2010 7:33 AM

For the last 30 years all profit from increases in productivity have gone to corporations and little to none has gone the workers. That trend is accelerating in todays job market. Today people (those who have a job) are taking pay cuts and working longer and harder, driving productivity up even higher.

Posted by: timothy2me | September 29, 2010 7:29 AM

KATHYMAC1:

"Explain why public corporations to be taxes."

Explain why the following companies got these welfare handouts...

Fannie Mae ($100 billion)

2. Freddie Mac ($100 billion)

3. AIG ($60 billion)

4. Bank of America ($45 billion)

5. Citigroup ($45 billion)

6. JPMorgan Chase ($25 billion)

7. Wells Fargo ($25 billion)

8. GM ($13 billion)

9. Goldman Sachs ($10 billion)

10. Morgan Stanley ($10 billion)

Posted by: cirrus_nine | September 29, 2010 3:24 AM

There isn't enough room on this thread to truly explain how Bill Gates got to where he was. In the faint hopes you wish to learn more, try reading "Overdrive" by James Wallace. The amount of software development Bill Gates actually did is quite minimal according to many accounts. I have worked with individuals who have done much more in this area, such as Dave Korn from Bell Labs.

I respect Warren Buffet however. He seems sincere in his efforts to be kind and helpful.

There are many rich people who have worked hard and are intelligent. I stated that people associate money with this and that is a mistake. I have met many dumb rich people. Many dumb rich people got us all into the Wall St financial mess we have had. There were many in academia that were calling the down fall of this system long before people in more powerful positions realized it.

Posted by: cirrus_nine | September 29, 2010 3:20 AM

And that goes for the two jerks who penned the ground rules...like you could teach Bill Gates or Warren Buffet to be good guys. You bozos need to get real. You could spend you entire life carrying on Mother Teresa's work and you still wouldn't hold a candle to either one of those two. The shear gall of you two idiots amazes me. You haven't done SQUAT with your short, miserable, pasty-faced lives yet you're going to lecture people who've done more for human-kind than you can even imagine. If it weren't for Bill Gates you poindexters would still be typing on your Corona's (look it up genii). You ultra-maroons.

Posted by: PanhandleWilly | September 28, 2010 11:49 PM

All you "I hate the rich" posters make me puke. The top two guys have given more money away to worthy causes in the last hour than any and all of you put together have done in your entire lives. You're pathetic losers...the lot of you.

If you had their money you'd be drunk, chasing cheap tail for kicks...because you're pathetic losers. You'll probably be at the 10-2-10 Fluffer rally this week-end after not showering for a few days...and you'll trash the place and make the Park Police clean up after you...all six of you who show up with your commie buddies.

Posted by: PanhandleWilly | September 28, 2010 11:41 PM

The capitalist structure rich business men must exploit others. By offering them lower wages to bring in high talent. By offering inferior products at higher prices. To gain wealth through rent seeking. To monopolize by the power of government...

Posted by: mlutter | September 28, 2010 10:51 PM

to cirrus nine

Explain why public corporations to be taxes.

The employees, CEOs and Board are taxed, if corporations are taxed that money comes out and then stockholders get to split the earnings, you know the people who have 401ks etc, so you are just taking money out of their pockets

Posted by: kathymac1 | September 28, 2010 10:17 PM

why give it all the government of course, isnt that what the future tax laws will require?

Posted by: kathymac1 | September 28, 2010 10:15 PM

POSTED BY: PHIGGITS

Alot of rich people pick our little pockets every day to enormous amounts every day. You want to talk about major fleecing of the middle and lower classes ... bail out.

Biggest welfare recipients in this country are large corporations run by some of these rich CEO so many idolize.

Posted by: cirrus_nine | September 28, 2010 10:04 PM

aaahhhh yessss. the politics of envy on full display. what kind of loser spends so much time deciding what other people should do with their money or whether they deserve it? get on with your own life! if you think someone else needs help, then help them...but not by picking someone else's pocket to do it.

Posted by: phiggits | September 28, 2010 8:50 PM

By paying the same tax rate as we folks in the group formerly known as the middle class, (now known as the new poor) the super rich could justify their existence. Somewhat.

Posted by: nicekid | September 28, 2010 6:46 PM

Do not presume because someone is rich, that they are hard working and intelligent. Do no presume because someone is poor, that they are lazy and unintelligent.

Dr Salk is a prime example of someone who remained middle class and poor but chose to take his idea and make it public to help others. You look at most of the great thinkers, writer, artists, philosophers and scientists ... They werent exactly spending their afternoons in their own private golf courses.

Posted by: theAnswerIs42 | September 28, 2010 4:47 PM

I don't think anyone has a problem with someone taking risks and getting reward through hard work. Bill Gates, Warren Buffet, even (ugh) the Kochs come from money built in a generation, and whatever I think of some of these people (Kochs) the fact is they were making something.

The bigger problem is we have tipped the scales to favor those who have so much, where even under a progressive tax system, they pay less of a percentage of their income than people who make far less than a million dollars. When hedge fund managers are pulling in billions in a given year, when a CEO of a company that is languishing is making millions while asking workers to take less pay to have the company survive this economy and some bad decisions (I am looking at you Harley) when those same CEOs make the decision to ship jobs overseas to cut expenses, eventhough if enough businesses do that we will not have anyone to buy their wares, then there is something wrong.

Posted by: daedbird | September 28, 2010 4:43 PM

I wasn't much interested in the Forbes 400 but I have reconsidered. Over the past two decades at least three phenomenon have happened. Consolidation within sectors, big box store presence, outsourcing of production and jobs. It will be interesting to see how the rich became wealthy.

Consolidation and big boxes vacuum money out of the State and community, the money is sent to a focal point. Wealth is consolidated and the money multiplier effect is lost in thousands of communities. Small and mid-size businesses are replaced with store managers, shelf stockers and cashiers. The money multiplier moves where profits are taken and production takes place. The Chinese worker buys a bowl of noodles and the cook buys from the noodle maker, the fish catcher and vegetable grower, stimulating economic activity. The manager, shelf stocker and cashier buy from their employer. No economic activity is created in the community.

This is similar to factory farming vs a thousand individual farms. The global master-serf model distorts the cycle of money in local economies. Laying off thousands of shelf-stockers is not a corporate hardship. It is no mystery the Northeast became wealthy and the South stayed poor.

The income gap is a symptom, not a cause and simple taxing does not fix the problem. In other words, we are too efficient. Low wage workers can not boost demand, so more jobs are transferred to low wage countries and more local workers laid off to lower prices.

In 1935, the companies complained there was too much competition when low wage workers or the jobless could not buy their products.

Posted by: Beacon2 | September 28, 2010 4:42 PM

Most rich people get rich by stepping over the backs of others. Rarely do the rich provide ideas and leadership to the masses that make our lives better.

Bill Gates stole ideas and bullyied his competition to get rich. I think he has developed guilt over the last few years after leaving Microsoft and is now giving a fraction of the money back he grabbed from unethically from his competition.

Posted by: theAnswerIs42 | September 28, 2010 4:35 PM

The entire premise here is ridiculous. These people don't owe us anything. They have taken extreme risks (like dropping out of Harvard to start a business in their garage), and the markets have rewarded their success. People may hate Microsoft, but it employs tens if not hundreds of thousands of people. The same goes for Berkshire Hathaway, which Warren Buffett has built up over decades of intelligent, savvy investing and a personal thriftiness that is well-known. Little capitalist gremlins did not go around to all your houses at night, steal your gold, and pile it up in Warren Buffett's impregnable fortress. This country, and particularly the media, need to be purged of the poisonous thinking that rich people got there because of inherent "unfairness" in our society, or by somehow exploiting the millions of people they created jobs and livelihoods for (that are now taxpayers in their own rights). Are we scapegoating people for achieving the American Dream now?

Simply caterwauling about the "disparity" in wealth accomplishes nothing, and provides excuses for people who for whatever reason can't or won't succeed on their own merits. Maybe we should be wondering why the Democrats continue to effectively subsidize poverty by continually expanding social programs, unemployment (pushing 2 *YEARS* now), and catering to low income illegal aliens they hope will blossom into Democrat-voting butterflies in the future. If the last 2 years have taught us anything, it's that demonizing "the rich" and their related companies slams the brakes on the economy faster than anything else you can think of. All the government make-work programs in the world won't save us when the people who actually create jobs decide they've had enough with the meddling and fear-mongering.

Posted by: zippyspeed | September 28, 2010 3:40 PM

The wealthy people have thrived in the capitalist environment. In order to thrive in the capitalist structure all decisions are made to benefit you and put your company in a position to monopolize a market and eat all others for breakfast. How could these people possilby help America advance. Unless we are going to change our name to the United States of Microsoft. They live off middle class.